Is Now The Right Time To Invest In Nvidia? Fund Managers Are Split: 'One Of The Hardest Things I've Done'

The stock of NVIDIA Corp NVDA has been on a rollercoaster ride, with a 240% surge in 2023 and an additional 80% increase in 2024. This has led to a debate among investors on whether to buy now or wait for a potential drop in the stock price.

What Happened: The recent performance of Nvidia’s stock has sparked a debate among fund managers. Trent Masters, a portfolio manager at Alphinity Investment Management, suggests that the stock is still a good buy despite its significant rise. He points to the chipmaker’s strong market share and sustainable earnings as reasons for his bullish stance, reported CNBC.

"I personally missed the initial run in Nvidia and only bought the stock when it rose to $390 last May after its results. It's probably one of the hardest things I've done in the last 10 years to buy a stock that's already up so much because it feels like you could be making a mistake. But I think investors just have to view these things objectively," Masters said.

On the other hand, Adam Coons, a portfolio manager at Winthop Investment Management, is advising caution. While he acknowledges Nvidia’s strong position in the AI chipmaker segment, he believes the current valuations are inflated. Coons is reducing his holdings and waiting for the stock’s valuation to normalize before considering further investments.

"Nvidia is a company that ran too far too fast. We've been holding Nvidia through the rally, but we've started to sell because the current valuations are inflated," Coons said.

"Long-term, it is definitely a company or a stock you want to own. I just think you need to be careful in the short term around some higher volatility and some bigger swings," Coons added.

See Also: Chinese Tesla Rival Zeekr Soars 35% On NYSE Debut, Valuation Hits $6.8B

Why It Matters: The debate over Nvidia’s stock comes at a time when the company’s market value has soared to $2.27 trillion, tripling due to the market’s increased trust in AI technology, where Nvidia plays a key role.

This has led to a surge in optimism around the company’s stock, highlighted by a major partnership with Mitre to use a $20 million supercomputer to boost AI for the U.S. government.

Despite the recent dip in stock price, Nvidia’s continued dominance in the AI sector has been evident through the substantial investments made by tech behemoths like Microsoft, Meta, and Google into Nvidia’s AI technology. This has further solidified Nvidia’s position in the AI sector and contributed significantly to its growth story.

Goldman Sachs revised its 12-month price target for Nvidia to $1,100, up from the previous $1,000, maintaining a ‘Buy' rating. This update follows an increase in earnings projections for 2025 through 2027. Analysts continue to praise Nvidia's sustained demand for AI servers and an improving supply chain landscape.

Read Next: Nvidia’s Triumphant Rise To A $2.27 Trillion Titan And Goldman Sachs’ Bold 22% Growth Prediction As New Partnerships Forge Ahead

Image Via Shutterstock

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Posted In: EquitiesNewsMarketsAnalyst RatingsTechAdam CoonsAlphinity Investment ManagementFund ManagersKaustubh BagalkoteTrent MastersWinthop Investment Management
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